The market for mobile apps has taken advantage of the times of social distancing and brought out a mass of innovations and new apps - both professionally and privately.
As users seek more personalized experiences and developers strive to ensure continuous value delivery, the seamless integration of subscription options presents a golden opportunity.
According to Statista, in 2027, people are expected to spend around $186 billion on mobile apps from the Apple App Store and Google Play. This is a big increase of over 50 percent compared to what consumers spent in total in 2022 on these two app platforms.
Offering subscription models and tailored plans within your application has become a pivotal strategy for both user satisfaction and sustainable revenue generation. This article delves into the essential insights and steps necessary to successfully implement subscriptions and plans into your application
Understanding the Subscription Business Model
A subscription is a set of benefits that users can receive for a specified period of time. For example, a user with a subscription can watch videos from the application without ads and in better quality.
You can have multiple subscriptions within the same app, either to represent different sets of benefits, or different tiers of a single set of benefits (for example, “Basic” and “Premium” plans).
Through base plans and offers, you can create multiple configurations for the same subscription product. For example, you can create an introductory offer for users who have never subscribed to your app. Similarly, you can create an upgrade offer for users who are already subscribed.
For a detailed overview of subscription products, base plans, and offers, see the documentation in the Play Console Help Center.
The subscription-based model has emerged as a dynamic and versatile approach in the modern business landscape. This model offers customers ongoing access to a product or service in exchange for regular payments, fostering a more predictable and sustainable revenue stream for businesses. The allure of subscription services lies in their ability to cultivate strong customer relationships, as users become invested in the value and benefits offered over time. For consumers, subscriptions often translate to enhanced convenience, continuous updates, and personalized experiences tailored to their evolving needs. As this model continues to gain traction across various industries, its potential to foster long-term loyalty and financial stability for businesses while providing enduring value to customers remains a compelling proposition.
Subscription-based apps offer both benefits and drawbacks for your project.
Benefits of subscription-based apps for your project
For companies that create a subscription app, it brings a steady and predictable stream of revenue, enabling them to plan and invest in continuous app improvements and updates. This model fosters stronger customer engagement as subscribers are more invested in the app's value, which can lead to increased user loyalty and longer-term relationships. Subscription-based apps often allow for a higher level of personalization and ongoing user support, enhancing the overall user experience.
Drawbacks of subscription-based apps
However, there are drawbacks to consider. Some users might be hesitant to commit to recurring payments, which can lead to a smaller initial user base compared to one-time purchase apps. Implementing and maintaining a subscription system can be complex and require ongoing technical support. Additionally, the subscription model demands a consistent delivery of valuable content and features to justify the recurring payments, which could place pressure on your development team to continuously innovate. Striking the right balance between pricing and the perceived value of your app is also critical, as overpricing might deter potential subscribers, while underpricing could affect revenue generation.
If you are willing to create a subscription app, consider these benefits and drawbacks carefully to determine whether a subscription-based approach aligns with your project's goals and user base.
The Best Examples of Subscription Businesses
Subscription-based software examples showcase the versatility of this business model across various industries. Streaming services like Netflix and Spotify exemplify the entertainment sector's success with recurring payments, providing users access to vast libraries of movies, shows, and music. In the realm of productivity, Microsoft's Office 365 offers a suite of essential tools under a subscription umbrella, granting users continuous updates and cloud integration. Even creative endeavors benefit, as Adobe's Creative Cloud allows artists and designers to access a wide range of professional software applications through a subscription plan.
Some other subscription-based software examples:
- Apple One offers a consolidated package featuring Apple's top six services (TV+, Music, Arcade, iCloud+, News+, and Fitness+), all available for a single monthly fee.
- Amazon's Prime membership unlocks access to their extensive TV and movie content library, along with the convenience of their "Subscribe and Save" feature, which automates orders and deliveries on a predetermined schedule – think about having your essential items like toilet paper delivered automatically.
- Scribd, an e-book platform, presents subscribers with unlimited access to over 60 million documents, encompassing articles, books, and audiobooks, contributed by various authors. These resources can be downloaded onto the Scribd app for offline use, as long as the subscription remains active.
Planning Your Subscription App
How to create a subscription-based app? Planning your app involves a strategic approach to navigating the intricacies of how to create a subscription app. This process begins with a thorough understanding of your target audience and their needs, ensuring that the subscription model aligns with the value your app offers. Market research helps identify competitors and trends, providing insights to differentiate your app. Determining pricing tiers, benefits, and features is pivotal in enticing potential subscribers. The app's user interface and experience should be designed intuitively, simplifying the subscription process and enhancing user engagement. Technical considerations, like integrating a secure payment gateway and backend management, play a critical role in seamless subscription management. Let’s consider in detail how to create a subscription app both on the iOS and Android operating systems.
Incorporating subscriptions and plans in the iOS app
An In-App subscription is an increasingly popular way to monetize a mobile app. It involves collecting periodic payments in exchange for premium content and extended services.
Choose the Right Subscription Model
First of all, carefully consider the most suitable subscription model for your application. Common options include auto-renewable subscriptions and non-renewing subscriptions. Auto-renewable subscriptions are ideal for providing continuous value, while non-renewing subscriptions are better suited for finite services or content access.
Auto-renewable subscriptions allow you to break away from Apple's usual 70/30 revenue split. Apple incentivizes apps offering ongoing value by increasing the developer's share to 85% starting from the second year of subscription. If a user cancels or switches to another subscription group within 60 days, the one-year mark is reset. So, make sure your subscription offers an experience your users will want to keep for the long run.
Set Up Non-Renewing Subscriptions on App Store Connect
- From My Apps, select your app.
- In the sidebar, click Subscriptions.
- Scroll down to Non-Renewing Subscriptions, and click Manage.
- Click the add button (+).
- Enter a Reference Name and Product ID, then click Create.
- Set a price and add localizations.
- Click Save.
Set Up Auto-Renewable Subscriptions on App Store Connect
- Log in to App Store Connect:
- Go to https://appstoreconnect.apple.com and sign in with your Apple Developer account credentials.
- Navigate to Your App:
- Once logged in, you will see a list of your apps. Select the app for which you want to set up in-app purchases.
- Access Features Section:
- In the left-hand sidebar, click on "Subscriptions".
- For Auto-Renewable Subscription, all subscriptions must be a part of a group. Users can only subscribe to one subscription in a group at a time but can change to another subscription in the same group.
- Create a Subscription Group:
- In the sidebar under Features, click Subscriptions.
- Click the add button (+).
- Enter a reference name.
- Click Create
- Create an Additional Subscription Group if needed:
- If you want to offer groups of subscriptions with varying subscription levels, you’ll need to create more than one subscription group. Users who buy subscriptions in multiple groups are billed separately for each subscription.
- In the sidebar under features, click Subscriptions.
- Click the add button (+).
- Read and acknowledge the warning by selecting the checkbox and clicking Next.
- Enter the reference name for the new group.
- Click Create.
- Add subscription products:
- In the Sidebar under features, click Subscriptions.
- Click a subscription group name.
- Click Create (or add button if you're adding a subscription to a group that already has existing subscriptions).
- Enter a Reference Name that clearly indicates what in-app section this purchase will unlock.
- Enter a unique Product ID, typically starting with the Bundle ID and appending a specific name for this purchasable item. Note the Product ID for future reference.
- Once you've created your subscription product, you'll be taken to its information page to add more details.
- Under Subscription Duration, choose a duration and click Save.
- Under Subscription Prices, set a price.
- Optionally, enable Family Sharing, and edit the subscription’s tax category.
- Localize the subscription display name, description, and promotional image to support different languages and regions. This ensures your app appears professional and relevant to users worldwide.
- Provide review notes for Apple's app review team in App Store Connect. Include relevant information about your subscription and its features to expedite the review process.
- Click Save.
Integrate in-app purchases into your iOS app
- Open your project in Xcode and select the correct target for your app.
- Navigate to the project settings, and under the "Signing & Capabilities" tab, click the "+" button to add a new capability.
- From the list of capabilities, select "In-App Purchase" and click "Add."
- Import the StoreKit framework into your code to interact with the App Store:
Implement methods to fetch product information, make purchases, and process transactions. Your class should conform to the SKPaymentTransactionObserver protocol. For instance, you can create an IAPHelper that looks like this:
SKPaymentQueue: It's a queue managed by StoreKit where all transactions are held until they are processed, completed, or failed.
SKProduct: It represents a product that you have declared in iTunes Connect with all the necessary information, including pricing, localized title, description, and more.
SKPayment: It represents an intent to purchase a product. You create an SKPayment object with the corresponding SKProduct and add it to the SKPaymentQueue to initiate the purchase.
SKPaymentTransaction: It represents an event regarding a SKProduct purchase. You receive transaction updates through the
method in the SKPaymentTransactionObserver.
SKProductRequest: It's a request made to fetch information about SKProducts by providing their product IDs. It allows you to retrieve the necessary details about your products from the App Store.
SKProductResponse: It's the response obtained after making an SKProductRequest. It contains two lists:
- products: Successfully fetched SKProducts are stored in this list.
- invalidProductIdentifiers: It includes identifiers that fail to correlate to an SKProduct
- after implementing IAPHelper adopt the IAPHelperDelegate protocol and implement the required delegate methods:
- to handle the fetched products showing them to the user
- to handle any error encountered during product fetching or purchase
- to handle successful purchase
Call the fetchProducts() method of the delegate to fetch the available products.
When the user initiates a subscription process, call the purchase(product:) method.
If the purchase was successful iapHelperDidCompletePurchase will be called, where you can update UI granting access to premium content or unlocking features.
- Transactions can happen outside your App. Say your user changes their subscription type in the system settings, or your deferred transaction was approved by the user’s parents, you won’t be able to tell unless you are expecting them.It’s important to add the observer at launch, in application(_:didFinishLaunchingWithOptions:), to ensure that it persists during all launches of your app, receives all payment queue notifications, and continues transactions that may initiate outside the app. This way you will make sure you won’t miss any event.
Validate the Receipt
To indicate that a user has purchased a product you need to perform receipt validation. There are two ways to verify a receipt’s authenticity:
- Locally, on the device. Validating receipts locally requires code that reads and validates a binary file that Apple encodes and signs as a PKCS #7 container.
- On your server with the App Store. Validating receipts with the App Store requires secure connections between your app and your server and between your server and the App Store.
Validating the receipt locally requires you to develop or use code to read and decode the receipt as a PKCS #7 container, as defined by RFC 2315. The App Store encodes the payload of the container using Abstract Syntax Notation One (ASN.1), as defined by ITU-T X.690. The payload contains a set of receipt attributes. Each receipt attribute contains a type, a version, and a value.
The App Store defines the structure of the payload with the following ASN.1 notation:
To validate the app receipt, perform the following tests in order:
- Locate and load the app receipt from the app’s bundle. The class Bundle provides the location of the receipt with the property appStoreReceiptURL.
- Decode the app receipt as a PKCS #7 container and verify that the chain of trust for the container’s signature traces back to Apple Inc. Root certificate, available from Apple PKI. Use the receipt_creation_date, identified as ASN.1 Field Type 12, when validating the receipt signature.
- Verify that the bundle identifier, identified as ASN.1 Field Type 2, matches your app’s bundle identifier.
- Verify that the version identifier string, identified as ASN.1 Field Type 3, matches the version string in your app’s bundle.
- Compute an SHA-1 hash for the device that installs the app and verify that it matches the receipt’s hash, identified as ASN.1 Field Type 5.
The validation passes if all of the tests pass. If any test fails, the validation fails.
If your app receipt validation fails, respond to that failure as follows:
- Don’t try to terminate the app. Without a validated receipt, assume the user doesn’t have access to premium content. Provide a user interface to gracefully handle this case and inform the user what they can do to get full access to your app’s features.
- If the app receipt is missing or corrupt, use the SKReceiptRefreshRequest object to refresh the app receipt.
- In the sandbox environment, if the app receipt is missing, assume the tester is a new customer and doesn’t have access to premium content.
Users can manage their subscriptions in their account settings on the App Store, where they see all renewal options and subscription groups, and can choose to upgrade, crossgrade, or downgrade between subscriptions as often as they like. You can also use the showManageSubscriptions(in:) method to allow them to do this within your app. When someone makes a change in their subscription level, the timing of the change varies depending on what has happened:
- Upgrade: If someone purchases a subscription offering a higher level of service than their current subscription, they are immediately upgraded. Additionally, they receive a refund of the prorated amount from their original subscription. To ensure users can access the upgraded content or features immediately, prioritize the subscription as an upgrade.
- Downgrade: If a user selects a subscription with a lower level of service than their current subscription, the existing subscription continues until the next renewal date. At the next renewal, the subscription is renewed at the lower level and price. This approach provides a seamless transition for users.
- Crossgrade: When a user switches to a new subscription of equivalent level, the timing of the change depends on the duration of the old and new subscriptions. If both subscriptions have the same duration, the new subscription begins immediately. However, if the durations differ, the new subscription goes into effect at the next renewal date.
Test Subscriptions in App Store Connect Sandbox
The free version of an Apple Developer account won't allow you to set up subscriptions. You will need a paid one. Additionally, testing must be conducted on a real device, as simulators do not offer support for subscriptions.
When testing subscriptions in a development build of an app, Apple provides a test environment that allows you to "purchase" your subscription products without creating financial transactions.
Creating a Sandbox User:
- Open App Store Connect and navigate to "Users and Roles."
- Click on the "Sandbox Testers" tab and then click the "+" button next to "Tester."
- Provide a first and last name for the test user. Use a real email address, as Apple will send a verification email to this address.
- Once you receive the verification email, click the link to verify the email address.
- Ensure that the email address you use is not associated with an existing Apple ID account.
Preparing the Device for Testing:
- On the device you'll be testing with, open the iOS Settings app and tap "iTunes & App Store."
- Tap your Apple ID and then select "Sign Out."
- In your app, verify that users can select the desired subscription plan, initiate the purchase, and see the confirmation screen.
- When prompted for payment, enter the username and password of the Sandbox account you created on App Store Connect.
- Tap "Continue" and then "OK" on any following popups.
- Ensure that the payment process completes successfully without any errors.
Understanding Subscription Renewals in Sandbox:
- The Sandbox environment allows you to test subscription events like renewals, state changes, and interrupted purchases without waiting for the actual subscription duration.
- After adding testers in Sandbox, you can choose a subscription renewal speed for each tester. By default, accounts are set to a speed equalization of 1 month = 5 minutes. However, you can adjust the renewal period to slow down or speed up the process.
- Keep in mind that subscriptions can renew up to 12 times before auto-renewal turns off on the thirteenth renewal attempt.
When implementing subscriptions in your app, it is essential to follow best practices to ensure a successful and user-friendly experience. Avoid hardcoding product IDs and fetch them dynamically from your server to provide flexibility in offering various subscription options. Rely on Apple for subscription data such as prices and descriptions to facilitate changes without requiring app updates. Consider offering in-app subscription management options for upgrading, crossgrading, or downgrading, and include a deep link to Settings for easy subscription cancellation. Clearly describe subscriptions to help users understand what they are purchasing and prevent confusion. When managing prices, take existing subscribers into account and decide whether to increase prices incrementally or only for new users. Lastly, adhere to Apple's guidelines for in-app purchases to ensure smooth implementation and compliance. By following these best practices, you can create a seamless and successful subscription model that attracts and retains subscribers.
Incorporating Subscriptions and Plans in the Android App
Use deep links to allow users to manage a subscription
As a developer, you must make it easy for your customers to manage their subscription. Your app should include a link on a settings or preferences screen that allows users to manage their subscriptions. An example of this link is shown in figure below:
If the user has a non-expired subscription, you can direct them to a URL similar to the following, replacing "your-sub-product-id" and "your-app-package" with the subscription ID and app package info:
If a user doesn't have any non-expired subscriptions within your app, use the following URL to direct them to the page that shows all of their other subscriptions:
Allow users to upgrade, downgrade, or change their subscription
Users should be able to upgrade or downgrade a subscription. When upgrading or downgrading a subscription, you can set the proration mode that determines how the change affects your subscribers.
The following table lists available proration modes:
For a detailed overview of proration see the documentation in the Android Developers Docs.
Google Play's billing system
Google Play's billing system is a service that enables you to sell digital products and content in your Android app. You can integrate Google Play's billing system with your Android app using the Play Billing Library.
You should also integrate Google Play's billing system with your server backend to create the necessary developer flows. This is essential to guarantee that your purchase management and cross-platform entitlements are efficient and secure.
Before integration, you need to create a developer account, and create and configure products in the Google Play Console.
For a detailed setup of a developer account, see how to setup a Google Play developer account.
Once you've set up a developer account, you must publish a version of your app that includes the Google Play Billing Library. This step is required to enable billing-related features in the Google Play Console, such as configuring the products you want to sell.
Add the Google Play Billing Library dependency to your app:
Once you've added the library to your app, build and publish your app.
After that, you can create and configure your products.
Life of purchase
Here's a typical purchase flow for a one-time purchase or a subscription.
- Show the user what they can buy.
- Launch the purchase flow for the user to accept the purchase.
- Verify the purchase on your server.
- Give content to the user.
- Acknowledge delivery of the content. For consumable products, consume the purchase so that the user can buy the item again.
Subscriptions automatically renew until they are canceled. A subscription can go through the following states:
- Active: User is in good standing and has access to the subscription.
- Cancelled: User has cancelled but still has access until expiration.
- In grace period: User experienced a payment issue but still has access while Google is retrying the payment method.
- On hold: User experienced a payment issue and no longer has access while Google is retrying the payment method.
- Paused: User paused their access and does not have access until they resume.
- Expired: User has cancelled and lost access to the subscription. The user is considered churned at expiration.
Initialize a BillingClient
Once you've added a dependency on the Google Play Billing Library, you need to initialize a BillingClient instance. Is the main interface for communication between the Google Play Billing Library and the rest of your app.
To create a BillingClient, use newBuilder() :
Connect to Google Play
After you have created a BillingClient, you need to establish a connection to Google Play.
To connect to Google Play, call startConnection():
Show products available to buy
After you have established a connection to Google Play, you are ready to query for your available products and display them to your users. Ensure your product display follows all Play policies.
To query for in-app product details, call queryProductDetailsAsync():
Use product ID and ProductType which were created in Google Play Console. The ProductType can be either ProductType.INAPP for one-time products or ProductType.SUBS for subscriptions.
Querying with Kotlin extensions
You also can query for in-app product details by calling the queryProductDetails() extension function.
Launch the purchase flow
To start a purchase request from your app, call the launchBillingFlow() method from your app's main thread:
On a successful call to launchBillingFlow(), the system displays the Google Play purchase screen:
You must implement onPurchasesUpdated() to handle possible response codes:
Once a user completes a purchase, your app then needs to process that purchase.
Your app should process a purchase in the following way:
- Verify the purchase.
- Give content to the user, and acknowledge delivery of the content.
To verify a purchase, first, check that the purchase state is PURCHASED.
After granting entitlement, your app must then acknowledge the purchase. This acknowledgment communicates to Google Play that you have granted entitlement for the purchase. If you don't acknowledge a purchase within three days, the user automatically receives a refund, and Google Play revokes the purchase.
The process to grant entitlement and acknowledge the purchase depends on whether the purchase is a consumable, non-consumable, or subscription.
To handle situations when your app could lose track or be unaware of purchases (such as Network Issues during the purchase, Multiple devices or Handling purchases made outside your app), be sure that your app calls BillingClient.queryPurchasesAsync() in your onResume() method to ensure that all purchases are successfully processed as described in processing purchases block.
queryPurchasesAsync() returns only active subscriptions and non-consumed one-time purchases.
queryPurchaseHistoryAsync() returns the most recent purchase made by the user for each product, even if that purchase is expired, canceled, or consumed.
This completes the integration. You can test the app as indicated in the documentation Test your Google Play Billing Library integration.
How many team members do you need to implement subscriptions into your app?
The number of team members required to effectively implement subscriptions into your app depends on the complexity of the project and the scale of your application. At a minimum, you would typically need a dedicated project manager, one or more software developers with experience in app development and backend systems, a UI/UX designer to create user-friendly subscription interfaces, and a product manager to align the subscription model with your app's overall strategy. Additionally, having a quality assurance specialist to thoroughly test the subscription features and ensure a seamless user experience is crucial. If your app has unique technical or design requirements, you might need to expand the team to include specialists in those areas.
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At Axon, we have extensive expertise in seamlessly implementing subscriptions and plans into a wide range of applications.
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In conclusion, the integration of subscriptions and tailored plans into your application holds the potential to revolutionize user engagement, satisfaction, and revenue streams. Through careful consideration of the steps outlined in this blog post, coupled with collaboration with skilled professionals, you can navigate this dynamic landscape with confidence.
Remember that successful implementation extends beyond technical prowess; it involves understanding your users' needs, crafting intuitive interfaces, and aligning your subscription strategy with your app's overarching mission. As technology and user preferences continue to evolve, the ability to offer flexible, value-driven subscription models will be a cornerstone of sustained success!